The increase in earnings per share that comes against a firm acquires another firm with a P/E ratio lower than its original price-earnings ratio.
And this phenomenon is solely because of the merge. The stock price does not matter.
And this phenomenon is solely because of the merge. The stock price does not matter.
When a corporation merges a comparatively small company with a lower P/E ratio,there wil be a false growth in the corporation's earnings per share.
by BarryPotter October 6, 2006